You don’t need a separate “cantillon effect” type theory. That’s like arguments against the existence of god to debate theists. Only the economics religion deists believe it doesn’t matter where you inject money. That’s a prima facie ridiculous idea that should be ignored.
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Increasingly of the few that the financial side of the economic problem — fiscal/monetary intervention design and debt restructuring work — is neither that difficult, nor that important if viewed as a mass supply chain problem. It’s only a moral panic issue for rentiers.
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Example: toilet paper shortage is a simple matter of unbalanced supply chains pushing slightly different products (biz/commercial grade is different from consumer grade) coupled with mild stock out panic. Fixable with some rebalancing and consumption flexibility. Why is $ harder?
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It’s a “problem” because some people derive large rents from incumbent distribution of money. A new distribution pattern would work for everybody except them. It’s not pure rents, there’s function too. Money flows via banks for good reasons. But those reasons have unraveled.
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The good reasons are that under normal conditions, there’s often a lot more need to move money at concentrated scales. They serve the need for 10 moves of a billion $ rather than a billion moves of $10. But that picture has changed.
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The normal unit economics of money are: bespoke and robust at large unit size, standardized and fragile at small unit size. New supply chain spec: robust and bespoke at small unit size. Quickly get $10 -$1000 to anyone in *hours to days* based on processing of personalized data.
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Need to think about velocity of money in a 2d space of unit size and transaction costs (not “cost of capital” which is a separate, narrower thing). Money needs to get much smarter in the low-unit-size/high-velocity quadrant so it can move more flexibly.
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Analogy: we shop for consumer-grade money ay the level of 19th century pre-supermarket general stores. Very low volume, velocity, variety. We need the e-commerce equivalent of money. An amazon of money which can deliver personalized money lots to the last mile.
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Chamath’s viral CNBC rant on “don’t bail out the billionaires” is currently a moral argument. It needs to be a supply chain argument. Nothing against the billionaires. They are just not the priority. Preserving their rents is simply the wrong supply chain problem statement.
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Yes cantillon effects is what I’m thinking of. Doesn’t need a special name. Only insane spherical cow economists think it doesn’t matter where you inject money
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